Today's motion picture industry is primarily structured to release movie content through motion picture retail exhibitors that own theaters or cinema houses (referred to in the figures as “Exhibitors”). The movie content or cinema is leased by the retail exhibitor, from the content owner, for showing in the retail exhibitor's theaters.
The term “day and date” used herein refers to the simultaneous release of the movie content (also interchangeably referred to as “cinema”) to a wide number of theaters and associated cinema screens on the same day. Exclusive distribution of day and date movies or cinema provides a first run market advantage to the retail exhibitor and also aids in marketing the movie/cinema for subsequent sales in other forms or formats.
The time between the retail theater's showing of the cinema—and the wider “follow on market” distribution of the movie is called the “window”. The content owners have “follow on market” sales subsequent to the retail theater sales that occur during the “window”. These “follow on market” sales by the content owners occur 60-90 days after the cinema leaves the theater. These sales are through multiple sources including, pay television channels such as Home Box Office (HBO™), Cinemax™, Showtime™, The Movie Channel™, Encore™, through pay-per view, through DVD sales and rental, for example, at Blockbuster™, Hollywood Video™, Netflix™, ClickStar™ and alternate venues such as airline movies. Later in the cinema content sell cycle, the motion picture will be distributed to broadcast television owners. These sales are exclusively from the content owner to the follow on market distributor. Retail exhibitors are not part of these transactions; therefore, the retail exhibitor gains no revenue from the follow on sales of the movie content that was first widely distributed in the retail exhibitor's theaters. Thus, where a movie is popular in theaters the continuing popularity doesn't yield continuous revenue to the retail exhibitor. Nor does a movie introduced to the public initially in select theaters, but becomes popular near or at the end of the “window” reap the retail exhibitor continued profit during subsequent DVD sales due to a late, but popular appreciation of the cinema content.
In FIG. 1, release cycle method 110 describes a conventional release cycle for a typical motion picture. The conventional release cycle of a movie includes an exhibitor 111, DVD&VHS rental 112, DVD sales 113, Pay per View sales 114, and airing on Broadcast Television 115. The release cycle is entirely controlled by the content owner. Only one viewing option is available for the consumer during the “window”, and that is to see the movie at the retail theater. The release cycle begins with release to contracted theaters, shown here as exhibitor 111; followed by release to rental stores, shown as DVD&VHS rental 112, followed by DVD sales 113, subsequently followed in time by pay per view sales 114, and finally to broadcast television 115. This release cycle has the advantage of providing multiple opportunities for the content owner to sell their product without creating sales channel conflicts. That is, for a given date in time, the consumer does not have the option to choose between seeing the movie at the theater versus buying or renting the DVD. Thus, the consumer's viewing choices are restricted according to specific calendar days that will govern the release of the movie product on certain media in certain outlets. In general, the viewing market is segmented in time and by the unique media types available at each point in time, first a motion picture 35 mm film, followed by DVD, or VSH tape, or Internet broadband downloads, or a digital cable or satellite feed, and finally terrestrial analog broadcast of the motion picture.
Retail exhibitors fervently desire to protect the “window” so that consumers will attend the theater to see the first run movies, and purchase concessions, which is a significant source or earnings and revenue for the theater owner. Stringent protection of the “window” is believed to be vital for the financial viability of the theater owners. Notably, the theater owner does not benefit from sales into the follow on markets.
In contrast, content owners merely respect the “window” due to the revenue garnered from exhibition and the marketing advantage it provides for follow on market sales. Nevertheless, most films do not make a full return on the studio production company's investment from domestic box office revenues. The revenue received from the “follow on markets” is steadily increasing as a proportion of the total revenue generated by the studio production company's film releases. This is at least in part driven by the increasing quality of the in-home experience enabled by the advent of the Home Theater System. In fact, the majority of income from a movie now comes from the follow on market sales—that is the release to DVD, pay per view etc. In sharp contrast to the retail exhibitors, the content owners collect revenue for sales at every point in the sales life cycle of the movie. This fact encourages content owners to shorten the “window” in order to recognize this growing source of revenue earlier in the life cycle of the movie. However, a shortened “window” is detrimental to the retail exhibitor.
In recognition of the growing phenomenon of home theaters, recent proposed changes to the release cycle have arisen. One such release cycle change was proposed by Mark Cuban, owner of Landmark Theaters™, and also a content owner as a result of his ownership of a small independent film studio, 2929 Entertainment™, has proposed the model shown in release cycle 120. The Cuban motion picture release cycle 120 includes the sales markets of exhibitors 121, DVD&VHS rental 122, DVD Sales 123, Pay per View 124, and Broadcast Television 125. Cuban's model provides “day and date” simultaneous release of the movie to exhibition 121 and to rental 122 or sales of DVD 123, as well as simultaneous release to pay per view 124, with only broadcast television having to wait to display the motion picture. The Cuban release cycle and others that have been proposed all have the limitation of disenfranchising the retail exhibitors or at least taking away a significant portion of their customers. At least some retail exhibitors would charge higher ticket and concession prices, while other retail exhibitors might close theaters. Ultimately, for those consumers who enjoy a traditional retail theater, it would become more difficult and expensive for the consumer to have access to the theater experience. Many traditional retail theater owners have reacted strongly against the Cuban concept, because they aren't simultaneous retail exhibitor and content owners. Therefore, traditional retail exhibitors would not reap revenue in this business model. Instead, the traditional retail exhibitor would lose revenue, because display of the movie at the retail exhibitor's site becomes drastically reduced. Consequently, the all-important concession revenue, based on customer foot-traffic at the retail exhibitor's cinema site, is drastically cut.
Alternative release cycle proposals are described in alternative release cycles 130 and 140. Included in FIG. 130 are the sales markets of exhibitors 131, DVD&VHS rental 132, DVD Sales 133, Pay per View 134, and Broadcast Television 135. Alternative release cycle 130 shows a pay-per-view option 134 offered simultaneously with the release of the movie at the retail theater by exhibitor 131. Release cycle proposal 130, provides an opportunity for additional motion picture sales early in the life cycle of the movie. However, this structured release cycle produces a channel conflict whereby the content owner is selling pay per view options simultaneously with the retail exhibitor offering ticket sales for theatrical viewing of the movie at the retail theater. Again, the retail exhibitor is shut out of revenue for the pay per view and the traditional revenue resulting from display of the movie at the retail exhibitor's cinema site is drastically reduced, because concession revenue based on customer foot-traffic at the retail exhibitor's cinema site is drastically cut.
Alternative release cycle 140 shows a hybrid approach involving the sales markets of exhibitors 141, DVD&VHS rental 142, DVD Sales 143, Pay per View 144, and Broadcast Television 145. In release cycle 140, Pay per View 144 is offered simultaneously with DVD sales 143. Such an arrangement can be conducted over the Internet should a customer have broadband capability. Accordingly, the content owner manages the release of both digital media types without impacting the traditional “window”.
There is a need; therefore, for an improved cinema release cycle that fosters increased sales for retail exhibitors, while providing additional viewing options for cinema consumers.